Industrial parks, economic zones the axis of Vietnam’s development: official

Industrial parks and economic zones have become the axis of Vietnam's socio-economic development, writes Vuong Thi Minh Hieu, deputy head of the Economic Zones Department under the Planning and Investment Ministry.

In recent times, they have contributed to the formation of many new urban areas, services and connected transportation systems, creating a new look for localities and gradually transforming backward agricultural areas into developed urban-industrial areas.

Coastal economic zones (EZs), with large-scale socio-economic development space and integrated production capacity, are playing a crucial role in transforming underdeveloped coastal areas into economic development driving regions through manufacturing, tourism and other industries.

As a result, we have seen the formation of high-quality urban areas and high-end coastal resorts leading, in turn, to the formation of coastal industrial cities.

Border gate EZs facilitate economic restructuring towards the development of trade, services, tourism and industry, thus expanding markets, increasing goods exchange, stimulating production and raising product competitiveness. Many border provinces that were previously remote and economically underdeveloped have become dynamically developing commercial centers, generating momentum for the development of neighboring areas.

Since the nation’s first industrial park (IP) – Tan Thuan Export Processing Zone – was established in Ho Chi Minh City in 1991, the country has developed 413 IPs – 369 outside economic zones, 37 within coastal EZs and seven in border gate EZs – with a total natural land area of about 129,900 hectares and an industrial land area of about 87,700 hectares.

Among the established IPs, 295 with a combined natural land area of about 92,200 hectares and a total industrial land area of about 63,000 hectares are operational; and 119 others are under construction, with respective natural land and industrial land areas of 37,500 hectares and 24,700 hectares. The occupancy rate of operational IPs in Vietnam is about 72.9%.

The nation’s first border gate EZ was Mong Cai in the northern province of Quang Ninh. Today, there are 26 border gate EZs in 21 provinces and centrally run cities with land borders covering a total area of 766,000 hectares. These zones have attracted over 300 projects with a total registered investment capital of about $4.4 billion.

Since the Chu Lai Open Economic Zone, Vietnam’s first coastal EZ, was established in the central province of Quang Nam in 2003, the country has developed a total of 18 coastal EZs spanning 857,600 hectares.

Under the approved master plan on development of Vietnam's coastal EZs by 2020, Vietnam was to have 19 coastal EZs with a total area of about 871,500 hectares.

With the efforts of authorities at all levels, industrial parks and EZs have been established in 61 out of the nation’s 63 provinces and cities, attracting a large amount of investment and serving the cause of national socio-economic development.

Eco-industrial parks

Industrial parks in Vietnam are gradually transforming their development models towards striking an economic, social and environmental balance, ensuring sustainable development and realizing green growth goals.

To implement the National Green Growth Strategy for 2012-2020 and 2021-2030 (with vision until 2050) as well as the National Action Plan for the 2030 Agenda for sustainable development, Vietnam has piloted the conversion of a number of IPs from traditional models to eco-industrial parks.

With the support of international organizations and experts as well as the efforts and determination of the government, these IPs have linked industrial activities with environmental protection, improving the quality of life for the surrounding communities.

The transformation of IPs towards sustainability has been carried out by promoting cleaner production and efficient use of resources through exchange of energy and by-products between businesses in the same area.

In the long term, in addition to converting existing IPs, Vietnam also aims to build new eco-industrial parks that meet relevant design and planning requirements for attracting environmentally-friendly projects.

After more than four years of implementing the pilot conversion of four IPs – Khanh Phu and Gian Khau in Ninh Binh province, Hoa Khanh in Danang city and Tra Noc 1&2 in Can Tho city – over 72 enterprises have implemented more than 900 energy saving and cleaner production solutions.

This has saved over 22,000 MWh of electricity, 600,000 cubic meters of water, 140 terajoules (TJ) of fossil fuels, nearly 3,600 tons of chemicals and waste amounting to over VND76 billion VND ($3.13 million) per year. They have also mobilized over VND207 billion ($8.54 million) from the private sector to implement these solutions.

The end results include greater socio-economic and environmental efficiency, mobilization of large resources from the private sector for green industrial solutions, energy security, sustainable development and effective climate change response.

Since 2020, the Ministry of Planning and Investment has coordinated with the UN Industrial Development Organization (UNIDO) in carrying out eco-IP interventions in Ho Chi Minh City, Can Tho, Dong Nai, Danang, and Hai Phong.

The interventions are based on approaches outlined in the Global Eco-Industrial Park Program.

At present, the MPI is supporting the construction of eco-industrial parks in Binh Duong province and implementing water circulation networks in a number of industrial parks in Hung Yen and Thua Thien-Hue provinces.

Orientations for further IP development

To realize its sustainable development goals, Vietnam’s IPs and EZs need to implement several breakthrough solutions in the coming time.

Firstly, they should boldly pioneer new industrial park and economic zone models focused on ecological and green features, application of advanced technology and innovations, towards the formation of "Vietnam's Silicon Valley."

Secondly, it is necessary to treat science, technology and innovation as the pillars for future development, creating a fostering environment for tech businesses and start-ups.

Thirdly, they should focus on investments from the world's leading corporations in the industries and fields identified as national priorities.

Fourthly, there is a need to develop production, industry and services on the principles of saving and effectively using land resources, promoting regional development links and forming industry clusters while minimizing the development of industrial parks on agricultural land with stable productivity and in areas with difficulties in site clearance.

Fifthly, economic development must go hand in hand with social infrastructure development and ensuring environmental sustainability. It is necessary to build houses and utilities for workers in IPs and EZs; and complete the industrial - urban - service ecosystem, ensuring their sustainable development.

Sixthly, IPs and EZs should strengthen inspection and supervision of compliance with regulations on environmental protection and construction of wastewater treatment plants; strongly reform administrative procedures; and act promptly in removing difficulties for investors.

Lastly, they should improve the competitiveness and attractiveness of local IPs and EZs with improved infrastructure (traffic, seaports, airports, logistics services); and greater sci-tech research and innovation.